When the Pohlads Sell the Twins the Taxpayers should get part of their profits

 

There's excitement in the air as the Pohlads announce plans to sell the Minnesota Twins baseball team after purchasing the team for $44 million in 1984.  Estimates are that the team is now worth $1.5 billion, and the sale will net the Pohlads a lot of money.

The state of Minnesota, Hennepin County, and Minneapolis taxpayers who subsidized the team should tax the profits to get back their investment in the Twins.

Professional sports are big business and very profitable. Profitability is largely due to the public subsidies it receives. Professional sports play on fan loyalties and threats to move as ways to extract corporate welfare from taxpayers. Many justify the subsidies by contending that sports stadiums provide. major economic stimuli for communities.  Yet no major, credible study supports this.  Viewed from an opportunity cost perspective, public investments in sports yield lower returns for the community than investments in museums, schools, or other public amenities. Yes, sports may contribute to the quality of life in an area, but they are not good economic investments for taxpayers.

Among the tactics sports owners use to increase their profitability is getting taxpayers to pay for the stadiums. Studies indicate that public investment in a new sports facility is one of the prime ways that teams and their owners increase profitability.  The Pohlads have benefited twice from the taxpayers in Minnesota.

 First prior to Pohlads purchase of the Twins in 1984, taxpayers provided subsidies to build the Metrodome. There was $155 million in bonds for the facility and $30 million in bonds for surrounding infrastructure.

Years later in 2006, the Pohlads successfully convinced the state of Minnesota, Hennepin County, and in Minneapolis to subsidize Target Field. This came after they threatened in 1999 to leave the state of Minnesota if Saint Paul taxpayers did not build them a stadium.  While St Paul voters rejected the tax and the team did not leave, just seven years later Minneapolis, Hennepin County and the State of Minnesota came up to bat and hit a home run for him.  They provided $90 million in bonds for infrastructure, $ 260 million in bonds for the facility, and Hennepin County enacted a 0.15% sales tax.

Thus, twice taxpayers have subsidized the Twins, a private business operating for private gain. As a result, the Pohlads original $44 million investment now will produce an estimated 1.5 billion sale. Such a gain is way beyond the inflation rate.  The $ 44 million in 1984 today would be worth $133 million.  The $1.5 billion far exceeds the rate of inflation and cannot be explained simply by increased valuation the Pohlads have added to the Twins unless one also includes the public subsidies.

While no one begrudges Poland's making money, they did so significantly at taxpayer support.  What they have now is an unrealized capital gain on their investment produced largely in part by public investment in their private business.  Their sale will be a realized capital gain.

Taxpayers are entitled to a part of that gain and the value of the team when it is sold. Exactly how much is not clear.  But nonetheless, the public made the Twins so profitable and valuable, and they are entitled to its fair share of the return on their investments.

The coming end of Tim Walz's political career in Minnesota

 Come this November, whether Kamala Harris wins or loses the presidency, Governor Tim Walz’s political career in Minnesota ends. 

Tim Walz has had an amazing run in Minnesota politics. It includes six terms as a member of Congress, having flipped a Republican conservative district Democratic, even if only temporarily, and by winning the governorship twice and becoming a star among progressives. Nationwide. He was selected as Kamala Harris's vice president both because of his supposed appeal to progressives and his folksy Midwest image that would endear him to swing voters in Pennsylvania, Michigan, and Wisconsin.

Were Harris to win the presidency, Walz would resign as governor, move off to Washington, and probably never return to Minnesota politics again. This would be like what happened to Walter Mondale after his national career ended. There is a slight chance that Walz might return to Minnesota much like Hubert Humphrey did after serving as vice-president and losing the presidency, but odds are against it.

On the other hand, were Harris to lose Walz will take the blame for her loss. It will be because of his missteps in many of his claims about his resume or because he turned out to be the wrong and risky choice for Vice President. Many said that perhaps Harris should have selected Pennsylvania. Governor Josh Shapiro to be her running mate, a popular political figure in the most critical swing state.

Were Harris to lose, Walz returns to Minnesota as governor. It will be in the remaining two years of his second term. It is hard to imagine that Walz would be successful in seeking a third term if he decided to do so. While Democrats like him, Walz has built up a lot of opposition across the state of Minnesota, receiving in his second election run for governor a smaller percentage of the vote than the first time, against an arguably weak opponent. Winning a third term in modern Minnesota history has only been accomplished once by Rudy Perpich, and that occurred under extraordinary circumstances of which it is unlikely we will see again.

Walz effectively becomes a lame duck after the 2024 elections in Minnesota, one way or another. Moreover, were the Republicans able to flip one or both houses of the legislature that would also significantly diminish or end his influence in this state. But even if the Democrats hold their political trifecta, they faced the consequences of a possible budget deficit according to the most recent fiscal forecast.  This was caused in part by the significant budgetary increases they enacted in the last two years. Walz will not have the budget surplus he did in the past to do the things he wants. He will have to make far more difficult choices politically than he had to do in his previous six years.

But even assume that Walz does stay on as governor and the Democrats hold the trifecta, having tasted the national spotlight, it is unlikely that he will want to continue his focus at the state level. As the adage goes, after you visited the city, it's kind of hard to keep you down on the farm.

 Under any of these scenarios, Tim Walz will become less of a feature in Minnesota politics in less than a month.